Adani Ports international and marine growth offsets geopolitical pressure on domestic volumes

Investment View and Valuation

ICICI Direct Research’s July 31, 2026 result update on Adani Ports and SEZ Ltd. retains a BUY rating and an unchanged target price of Rs 2,050, compared with a CMP of Rs 1,660. The broker’s positive view is supported by strong growth in international ports and marine operations, continued domestic-port revenue growth despite a difficult geopolitical backdrop, and the company’s FY31 expansion plans.

ICICI Direct values Adani Ports and SEZ at 17 times FY28E enterprise value to EBITDA.

Q1 FY27 Financial Performance

Adani Ports and SEZ reported consolidated revenue of Rs 10,820 crore in Q1 FY27, up 19 per cent year-on-year and 11.5 per cent sequentially. EBITDA increased 19 per cent year-on-year to Rs 6,540 crore, while EBITDA margin improved 23 basis points year-on-year to 60.4 per cent.

The report narrative states that consolidated PAT rose 10 per cent year-on-year to Rs 3,649 crore. However, the accompanying quarterly financial exhibit reports PAT of Rs 3,620 crore.

Segment Performance

International Ports and Marine

International ports and marine were the principal growth drivers during the quarter. International-port revenue increased 80 per cent year-on-year to Rs 1,747 crore, aided by the consolidation of NQXT Australia from Q4 FY26 and the ramp-up of Colombo operations. International volumes rose 2.96 times year-on-year to 22.8 MMT, while EBITDA increased 2.6 times to Rs 730 crore. EBITDA margin expanded to 42 per cent from 21 per cent in Q1 FY26.

Marine revenue grew 67 per cent year-on-year to Rs 901 crore, driven by vessel acquisitions. The vessel count reached 135, compared with 118 in Q1 FY26. Marine EBITDA rose 181 per cent year-on-year to Rs 404 crore, with the margin at 45 per cent.

Domestic Ports

Domestic-port revenue increased 12 per cent year-on-year to Rs 6,964 crore, driven by an improved cargo mix, including higher liquid cargo, associated port services and higher realisations. Domestic cargo volumes rose only 2 per cent year-on-year as the Middle East conflict affected volumes, while realisations increased 11 per cent year-on-year. Domestic-port EBITDA margin was 74 per cent, compared with 74.8 per cent in Q1 FY26.

Total cargo handled was 138.1 MMT, up 14.5 per cent year-on-year. Adani Ports and SEZ’s all-India cargo market share was 27.6 per cent versus 27.8 per cent a year earlier, while its all-India container market share was 44.8 per cent versus 45.2 per cent.

Logistics

Logistics revenue was broadly flat, rising 0.3 per cent year-on-year to Rs 1,173 crore, as Middle East disruption affected rail container traffic. Logistics EBITDA nevertheless rose 3.3 per cent year-on-year to Rs 219 crore. Container rail volume fell to 145,310 TEUs from 179,479 TEUs.

Guidance and FY31 Expansion Plans

Management retained FY27 revenue guidance of Rs 43,000-45,000 crore and EBITDA guidance of Rs 25,000-26,000 crore despite geopolitical uncertainty. The company plans FY27 capital expenditure of Rs 12,000-14,000 crore.

The company reiterated its FY31 aim of handling 1 billion metric tonnes, compared with 500 MMT in FY26. The target is expected to be supported by expansion in vessels, rail rakes, multi-modal logistics parks, warehouses and owned trucks.

Management targets FY26-FY31 compound annual growth of 19 per cent in revenue, 18 per cent in EBITDA and 18 per cent in net cash flow from operations. Logistics is expected to be the fastest-growing business. Planned FY27-FY31 capital expenditure is Rs 90,000-1,00,000 crore.

Management is also evaluating international acquisitions that meet its route, ecosystem, local-currency financing and return criteria.

Key Risks

• Lower-than-expected cargo-volume growth or slower economic growth.
• Failure to scale the logistics and marine businesses.